As I Had Always Thought - PowerStrokeNation : Ford Powerstroke Diesel Forum
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post #1 of 11 (permalink) Old 08-20-2008, 12:41 AM Thread Starter
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As I Had Always Thought

Let me start out with the observation that the prices of gasoline and diesel are high. Obviously the price of crude has a big effect.

What I want to zero in on is the fact that diesel fuel costs eighty cents a gallon more than regular unleaded (or premium for that matter) gasoline. The US is pretty much alone in that difference.

This table is in euros.

http://gasoline-germany.com/internat...ml?changeto=EN

From the link:

England
91 Octane Gasoline: €1.34
Diesel: €1.22
Spread: Gasoline is 10% more expensive than diesel


France
91 Octane Gasoline: €1.39
Diesel: €1.32
Spread: Gasoline is 5% more expensive than diesel


Japan
91 Octane Gasoline: €0.97
Diesel: €0.75
Spread: Gasoline is 29% more expensive than diesel


Australia
91 Octane Gasoline: €0.94
Diesel: €1.18
Spread: Gasoline is 26% more expensive than diesel


Germany
91 Octane Gasoline: €1.43
Diesel: €1.33
Spread: Gasoline is 18% more expensive than diesel

But at my local gas station
91 Octane Gasoline: $3.83
Diesel: $4.45
Spread: Diesel is 16% more expensive than premium gasoline


So let’s put the myth - that the spread of diesel over gasoline has anything whatsoever to do with world demand - down as being busted. In most countries that tend to prefer diesel cars, diesel is less expensive than gasoline. But in the US the reverse is true.

There is only one plausible reason: Ultra-Low (15 ppm) Sulfur Fuel is required ONLY in the US. It costs more money to remove the sulfur. This relationship was not true at all in 2006, prior to the advent of ULSD requirements. Gasoline and diesel cost roughly the same (gasoline was more expensive in summer, diesel more expensive in winter) prior to ULSD.

Diesel in the US is more expensive than gasoline and you can exclusively thank the EPA.

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post #2 of 11 (permalink) Old 08-20-2008, 11:45 AM
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Re: As I Had Always Thought

FWIW I do business with someone in Australia, and he said #2 is about $1.90 per liter, MUCH higher than your 1.18...
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post #3 of 11 (permalink) Old 08-20-2008, 02:27 PM
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Re: As I Had Always Thought

Quote:
So let’s put the myth - that the spread of diesel over gasoline has anything whatsoever to do with world demand - down as being busted. In most countries that tend to prefer diesel cars, diesel is less expensive than gasoline. But in the US the reverse is true.

There is only one plausible reason: Ultra-Low (15 ppm) Sulfur Fuel is required ONLY in the US. It costs more money to remove the sulfur. This relationship was not true at all in 2006, prior to the advent of ULSD requirements. Gasoline and diesel cost roughly the same (gasoline was more expensive in summer, diesel more expensive in winter) prior to ULSD.

Diesel in the US is more expensive than gasoline and you can exclusively thank the EPA.
Actually I saw a report (gotta try and find it again) about diesel and jet fuel pricing. Oil companies are over-inflating the prices of diesel and jet fuel to compensate for the lower prices of gasoline (lower prices relatively speaking ). They feel that "passing the buck" to businesses instead of consumers keeps them from looking like the evil big oil corporations in the eyes of the public, especially with the election year. If I can find it, it shows the net profits of gasoline shrinking over the past year, and the profits of diesel and jet fuel growing tremendously. And these were net profits, so refining costs were already factored in.

ULSD is still cheaper to process than regular unleaded, but more expensive than it used to be before the introduction of ULSD. Also some of those foreign countries produce diesel with the same or similar PPM as our fuel. And in case you were wondering, we do export diesel to Japan, and look at how much cheaper diesel is there compared to gasoline.

Curtis
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post #4 of 11 (permalink) Old 08-20-2008, 03:33 PM
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Re: As I Had Always Thought

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Originally Posted by Pocket View Post
Actually I saw a report (gotta try and find it again) about diesel and jet fuel pricing. Oil companies are over-inflating the prices of diesel and jet fuel to compensate for the lower prices of gasoline (lower prices relatively speaking ). They feel that "passing the buck" to businesses instead of consumers keeps them from looking like the evil big oil corporations in the eyes of the public, especially with the election year. If I can find it, it shows the net profits of gasoline shrinking over the past year, and the profits of diesel and jet fuel growing tremendously. And these were net profits, so refining costs were already factored in.

ULSD is still cheaper to process than regular unleaded, but more expensive than it used to be before the introduction of ULSD. Also some of those foreign countries produce diesel with the same or similar PPM as our fuel. And in case you were wondering, we do export diesel to Japan, and look at how much cheaper diesel is there compared to gasoline.
and then we have this
http://www.foxnews.com/story/0,2933,366601,00.html

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post #5 of 11 (permalink) Old 08-20-2008, 11:29 PM Thread Starter
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Re: As I Had Always Thought

I never have figured out how people can think that complex EPA regs can be complied with without incurring large costs.

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post #6 of 11 (permalink) Old 08-21-2008, 05:37 AM
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Re: As I Had Always Thought

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Originally Posted by Dave Whitmer View Post
I never have figured out how people can think that complex EPA regs can be complied with without incurring large costs.
There are additional costs thanks to ULSD, that is true. But for the refinery process, it's still cheaper to produce ULSD than it is regular unleaded. There are many more forces at work here than just the EPA.

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post #7 of 11 (permalink) Old 08-21-2008, 03:21 PM
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Re: As I Had Always Thought

The EPA has my focus because ULSD was not necessary. There are even more diesel engines available world wide, but, because of the EPA's agenda, they are not allowed here. I do not subscribe to their religion, nor should I have to.

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post #8 of 11 (permalink) Old 08-23-2008, 08:04 AM
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Re: As I Had Always Thought

Correct for taxes and you'll find a different story. It isn't a vast conspiracy.

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post #9 of 11 (permalink) Old 08-24-2008, 03:24 AM
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Re: As I Had Always Thought

Quote:
Originally Posted by DZL JIM View Post
FWIW I do business with someone in Australia, and he said #2 is about $1.90 per liter, MUCH higher than your 1.18...
Live rates at 2008.08.24 02:22:03 UTC
1.18 EUR

=

2.01028 AUD
Euro Australia Dollars
1 EUR = 1.70362 AUD 1 AUD = 0.586984 EUR


it's taxes. diesel and gas are not taxed at the same rates everywhere

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post #10 of 11 (permalink) Old 08-24-2008, 02:23 PM Thread Starter
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Re: As I Had Always Thought

No doubt taxes play a part, but US diesel taxes didn't jump up 80 cents a gallon in 2007. But diesel fuel does have to be run through the hydrodesulfurization unit TWO MORE passes than in 2006. Do you think that extra processing comes for free?

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